Do you know what is making your online store a success? Which of your strategies is working best to increase sales and revenue? Understanding the underlying aspects of your ecommerce business is essential to ensuring that it continues to grow. Measuring the performance of your business can help you increase your bottom line, but you have to track the right metrics to see the whole picture.
There are dozens of different metrics that you can measure; the needs of your business will determine which ones are right for you. However, there are some metrics that are important to the success of every ecommerce store, like cart abandonment rate and conversion rate. When you proactively monitor and track your company’s performance, you are able to catch issues sooner, forecast more accurately, and identify areas of opportunity faster.
The following are the key metrics you should be tracking to keep your business growing, broken down into categories – Products, Customers, and Performance.
Product Metrics to Track
There are a number product analytics that are important to keep an eye on to effectively manage your inventory. Use product segmentation to customize your automated reports so that you can optimize your inventory, improve the performance of slower-moving products, decrease your return rate, and enhance other key inventory strategies. Schedule automated reports daily or weekly for the following metrics:
- High Volume Products Checking your high volume product report weekly allows you to make the most of marketing campaigns featuring your best-sellers.
- Nearly Out of Stock One of the biggest disappointments for customers is finding the exact product they want, only to learn that it is out of stock. Closely monitoring this metric will help you avoid running out of stock and dissatisfied customers.
- Inventory Velocity of Products Watching this report will help you seamlessly manage your inventory and keep your storage costs low.
Use product segmentation to create dynamic segments and schedule automated reports monthly for the following metrics:
- Hot Products When you know what your hottest products are, you can ensure that you have enough inventory and optimize strategies to sell more of those products.
- Most Abandoned Products Knowing which products are abandoned the most will help you determine whether those products should continue to be a part of your catalog or if it’s time to liquidate them.
- Product Refund Rate It’s important to know what your refund rate is – even if it’s close to nothing – because you’ll need it for calculating other metrics. For example, when you are looking at your conversion rate, you have to take your refund rate into account, or your projected revenue will be inaccurate.
- Top Products Bundled Knowing which products are often purchased together can help you create and market more effective product bundles.
- High Gross Margin Products Discover which products net the highest gross margin to use in Paid Search Ads on your store’s site.
Use product segmentation to create dynamic segments and schedule automated reports quarterly/yearly for the following metrics:
- Product Conversion Rate This metric is important because it gives you insight into what your customers are actually purchasing. You can use this data to cross-sell other products and source new products more effectively in the future.
- Discounted Products and Cold Products Take the opportunity to review your slower-moving products and strategize how to unload, liquidate, or replace them.
- Product Category Performance Looking at this yearly allows you to compare year over year performance and make more informed decisions for the future.
Ecommerce marketers use Glew to create dynamic segments for product reporting analytics.
Customer Metrics to Track
When you schedule automated reports for customer metrics, utilize customer segmentation to drill down into the behaviors of your buyers to develop targeted marketing campaigns and strategies. Schedule automated reports daily or weekly for the following metrics:
- At Risk and Three Months Since Last Purchase Customers Create strategies for winning these customers back sooner rather than later.
- Abandoned Cart Customers Use this reporting to generate automatic emails to these customers daily.
- Repeat Customer Rate This reporting will tell you whether your campaigns are effectively retaining customers. This report should not be overlooked as retained customers are typically more profitable than newly acquired ones.
Schedule automated reports monthly for the following metrics:
- Zero Purchase Customers Determine which customers are in this segment to employ targeted email marketing with deals, discounts, or promotions to get them to purchase from your store again.
- VIP Customers Leveraging your high-value buyers as brand ambassadors is an effective way to create new marketing strategies.
- Average Time Between Purchases This reporting allows you to focus on the time between purchases so that you can implement strategies that will shorten that length of time.
- Cost per Acquisition Knowing how much it is costing you to acquire new customers is particularly useful when you have data on the lifetime values of your customers – even when an ad campaign is in the red when looking at CPA, if you know your customers are going to spend more in the future, you can afford to compete wherever you’re advertising and still come out ahead over time.
Ecommerce marketers use Glew to create dynamic customer segments for targeted email campaigns. Schedule automated reports quarterly or yearly for the following metrics:
- Lifetime Value of Customers Use this to stay on top of strategies to continually increase the lifetime value of customers.
- Relationship Length of Customers This reporting allows you to see your long-time customers who should be targeted differently than other customers.
Performance Metrics to Track
Overall performance metrics are designed to tell you how your store is performing in key areas. Schedule automated reports daily or weekly for the following metrics:
- Revenue by Traffic Source This metric is helpful in identifying which sales channels are working in bringing traffic to your site and which ones need further strategizing.
- Visits to Conversion Rate Understanding how many visits convert to a sale will tell you if you are attracting the right types of site visitors.
- Gross Profit This metric allows you to accurately budget for marketing based on the cost of goods sold.
Schedule automated reports monthly for the following metrics:
- Revenue by Channel You need this metric to determine whether your current ad spend strategy is working. If it isn’t, you are able to adjust the ad spend by sales channel to correct it.
- Average Order Value Use this metric to spot trends in rising or falling order value and modify your strategies based on what it shows.
Schedule automated reports quarterly or yearly for the following metrics:
- Revenue, Orders, and Lifetime Value Review these metrics quarterly and annually to understand year to year growth.
- Revenue, Orders, and Visits per Device Being mobile-friendly is vital. This metric tells you if your site is performing well on devices or if you need to work on your site responsiveness.
Ecommerce marketers use Glew to use the report builder to create and schedule automated monthly reports that are shared with executives and store owners. When you are an ecommerce marketer, it’s essential to be able to act quickly – tackling problems and marching ahead with opportunities – to grow your business and increase your bottom line. Carefully and regularly tracking the above metrics will enable you to do that. Reporting is easy with an analytics tool like Glew. Let us help you collect and report the data you need.